Have you logged into LinkedIn lately? The social platform is now more than just where you go to update your digital resume when you finally receive that promotion. The place is buzzing. It’s the virtual water-cooler where people network, share industry goss’, and write insightful and provoking articles. Since the turn of 2011, its user base has quintupled in numbers! Now boasting half a billion users, LinkedIn is big business. But why is it now so popular now?
Well, it’s not suddenly so popular. The increase in users has been steady and clear for nearly a decade. In an interview with Forbes, LinkedIn’s Vice President of Growth, Aatif Awan explained the company’s general strategy in growing its user-base. One major point the growth expert made was his and the business’ focus on a ‘North Star Metric’ (NSM). Now this metric is named because it is the one and only figure a business should look toward to see if they are on the right track. It should best encapsulate the value customers are deriving from your product or service. So for LinkedIn, their true-north goal is hosting a platform in which users find economic opportunities quickly.
So their go-to metric will be based around how soon new users are connected to other users. The analysts behind-the-scenes aren’t not concerned about other data, but this one figure is the most important. Other similar NSM’s are customer retention rates or time-spent with a service. For example, many social networks set targets for monthly-active users. This figure reveals how many people are actually engaged and continue to come back to their platform time and time again. Overall sign-ups do not mean customers are happy and satisfied. Some business owners and operators rely on ‘tactics’ to garner users fast to inflate their numbers. This is a poor business strategy because short-term growth does not automatically equate to long-term growth. In fact, a sudden increase can mask issues with attention devoted to efforts which do not provide users with true value.
Deciding on what your North Star Metric is may take some time. You could even choose several at the beginning to then hone down later to one single metric. The main point to take away from this concept is that a customer should always be feeling better off during and after they’ve encountered what you are selling. The rest is all secondary.
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